Bussines Ownership Flashcards
A Sole trader is..
Someone who runs a bussines on their own
Can sole traders employ people/ workers
Sole traders can employ people
Advantages of being a sole trader
Profit is all yours
You have all the control
Set up is easier as you have all the decisions
Disadvantages of being a sole trader
Storage of capital- don’t have enough capital to operate or grow
No continuity - owners dies, bussines will cease to exist
Unlimited liability
Capital is
Wealth in the form of assets
A business partnership is…
A busines owned by 2 or more people
Advantages of a business partnership
Different skills to offer
More capital raised
Shared workload
Continuity
Disadvantages of a partnership
Profit has to be shared between parties
There may be disagreements
Decision making may become slower
What is a sleeping partner in a partnership?
A sleeping partner invests money into the business. Not involved in day to day running or decision making
What is a Limited liability partnership
A partnership where the owners can only loose the capital they invested. Personal possessions are not liable
What is a deed of partnership? IT
A deed of partnership is a Contract between 2 or more people that provides..
Personal responsibility of each person
How profits and losses are shared
Details on how much capital each has invested
What’s a LLP
limited liability partnership
Definition of a company…
Business who’s owners are shareholders
What is a PLC
Public limited company
Sale of shared publicly on stock market
What is a LTD
Private limited company
Sale of shares to family and friends (privately)
